What is D2C eCommerce? Definition, Benefits & Examples
D2C eCommerce has been popular recently, creating more opportunities for businesses like manufacturers and wholesalers. According to Statista, China’s D2C market is expected to maintain its robust growth and reach 122 billion yuan by 2024. D2C sales of British was also forecast to reach 120 billion pounds by 2023. Another data point out by Statista to confirm the development The growth of this commerce is 118,000 jobs were expected to be created in D2C sales in the United Kingdom, reaching a total of 618,000 positions by 2023. The above figures once again demonstrate the growth rate of D2C ecommerce brands opens an era of development for D2C ecommerce companies.
So, what is D2C eCommerce, and how to join this market to get achievements? Let’s take a look at our brief introduction to D2C for eCommerce.
What is D2C eCommerce?
What is D2C eCommerce? D2C stands for direct-to-consumer, a form of e-commerce strategy aimed directly at consumers.
D2C eCommerce means that traditional manufacturers and businesses, instead of distributing their products through distributors, wholesalers, or retailers, now sell directly to the consumers of their products via the website.
For example, instead of selling agricultural products to distribution companies like supermarkets or groceries, farmers now create e-commerce websites and sell directly to customers through their online stores.
The Differences Between D2C eCommerce & Traditional Business Model
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The main difference is the operating processes of the two business models. Just like the name “Direct-to-consumer,” manufacturing businesses will completely ignore middlemen in their sales system.
For D2C e-commerce, a manufacturer will sell products directly to consumers through their eCommerce website.
With a traditional retail or B2B model, the manufacturer will distribute the product through a third party (wholesaler, distributor, etc.) before the product reaches the consumer.
Besides, in the traditional business model, businesses often sell products wholesale in bulk, but when switching to D2C eCommerce, they will be forced to sell more retail buying options. This is why not all manufacturers turn to D2C, as they will need to invest heavily in process-related activities such as marketing, shipping & distribution, payment, etc.
The Benefits of D2C eCommerce
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They were using the D2C eCommerce strategy to grant manufacturers lots of freedom in optimizing their sales methods.
The most significant advantage of using the D2C e-commerce strategy is freedom. The elimination of middlemen gives absolute control to manufacturers. They can now optimize marketing, sales, and shipping activities and pay for consistent multi-channel.
D2C brand reputation controls
With the traditional business model, the branding activities rarely empower the manufacturer but will be attached to the distributor.
However, with the active control of product distribution, D2C manufacturer has absolute control over brand reputation. They can optimize marketing to increase customer experience and expand brand reputation.
Customer experience improvement
Traditional business model manufacturers rarely interact with consumers but rather through distributors. Therefore, manufacturers will not have many opportunities to reach and fully understand consumers who have purchased products.
With D2C e-commerce, manufacturers have more opportunities to reach out and learn more about their consumers.
Best Brand D2C eCommerce Examples
Want some examples of D2C eCommerce to know whether this strategy would even work? Below are several D2C brands that have made it to the top with huge funds and successful results.
Apostrophe is an online dermatologist brand from Oakland specializing in telemedicine treatments for several conditions such as acne, hair loss, wrinkles & more with overall funding of 6.1 million.
Hims is a popular online pharmacy from New York. They’re offering prescriptions for men’s hair loss, ED, and even premature ejaculation. Their fund exceeds 197 million.
Nurx is the leading brand of online birth control in the United States and STI testing for women. They reside in San Francisco with a general fund of an estimated 93.4 million.
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